Microsoft Shares Carbon Removal Procurement Lessons After Signing 80 Million Tonnes in New Agreements

Microsoft has published a September 2026 briefing paper outlining lessons from six years of carbon dioxide removal (CDR) procurement. The report examines project development timelines, delivery risks, quality standards, and the role of government support in expanding commercial carbon removal capacity.

Between June 2023 and summer 2026, Microsoft signed offtake agreements covering 80 million tonnes of additional carbon removal procurement. Despite this activity, the company acknowledges that demand remains concentrated among relatively few buyers, while first-of-a-kind projects continue to encounter development challenges.

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Carbon Removal Procurement Can Take Five to Eight Years

Microsoft's first major finding concerns the time required to develop new carbon removal capacity. According to the report, buyers should anticipate approximately five to eight years between establishing a procurement program and receiving their first credits.

The company estimates that buyers may need six to twelve months to establish procurement procedures, followed by twelve to eighteen months for project evaluation and contract negotiations.

Developers may then require up to twelve months to secure financing and another 24 to 48 months to reach commercial operations. Receiving the first credits can take an additional three to six months.

Microsoft recommends that organizations with carbon removal targets for 2035 and beyond begin procurement planning early enough to accommodate these development periods.

Managing Project Development and Delivery Risks

The second lesson focuses on preparing for operational setbacks before they occur.

Microsoft identifies permitting complications, financing shortfalls, equipment problems, construction delays, and lower-than-expected carbon removal performance among the risks developers and buyers must consider.

The report recommends structuring agreements around defined delivery thresholds, opportunities to remedy underperformance, and predetermined contractual remedies.

These provisions can help buyers, developers, and financiers understand their responsibilities when projects encounter difficulties.

Microsoft also emphasizes early community engagement, particularly where projects depend on land access, biomass supplies, or geological carbon storage infrastructure.

Carbon Removal Quality Standards Must Improve With Deployment

Microsoft's third lesson addresses the challenge of expanding carbon removal while improving measurement and verification requirements.

The company argues that responsible deployment should continue alongside refinements to methodologies used to quantify atmospheric carbon removal.

Existing standards can provide a foundation for early projects, but unresolved accounting uncertainties must be identified and addressed as practical experience increases.

Microsoft encourages standards organizations to publish development roadmaps prioritizing methodological improvements that have the greatest influence on carbon removal calculations.

The report also distinguishes between measurement challenges in open-system approaches, such as forest restoration and enhanced rock weathering, and accounting considerations associated with engineered approaches, including direct air capture and bioenergy with carbon capture and storage.

Public and Private Investment Can Accelerate Carbon Removal Projects

The fourth lesson highlights the importance of combining corporate purchasing commitments with government support.

Microsoft identifies subsidies, investment risk-sharing arrangements, regulatory certainty, and shared infrastructure as mechanisms that can improve project economics.

The report cites Stockholm Exergi and Hafslund Celsio as examples of developers benefiting from private offtake commitments alongside public support.

It also highlights Norway's Longship carbon capture and storage initiative, including the development of CO2 transport and storage infrastructure through Northern Lights.

Looking beyond 2030, Microsoft stresses that firm purchasing commitments made years before expected delivery will be essential to financing additional capacity.

About Microsoft

Microsoft is a global technology company providing cloud computing, artificial intelligence, software, and enterprise services.

The company launched its carbon removal procurement program in 2020 as part of its commitment to become carbon negative by 2030 and remove the equivalent of its historical emissions by 2050.

Its procurement strategy supports both nature-based and engineered carbon removal pathways, with an emphasis on verified climate benefits, durability, and the development of additional removal capacity.